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Family Economics and Financial Education

Family Economics and Financial Education. VALUES, NEEDS, WANTS, AND GOAL SETTING ESSENTIALS. WHAT IS A VALUE?. A value is a fundamental belief or practice about what is desirable, worthwhile, and important to an individual. What are examples of values?. Financial security. Helping others.

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Family Economics and Financial Education

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  1. Family Economics and Financial Education VALUES, NEEDS, WANTS, AND GOAL SETTING ESSENTIALS

  2. WHAT IS A VALUE? • A value is a fundamental belief or practice about what is desirable, worthwhile, and important to an individual What are examples of values? Financial security Helping others Family Education A successful and/or satisfying career Religious commitment Honesty Good health

  3. VALUES Values guide a person’s needs, wants, and goals Values, needs, wants, and goals influence a person’s daily decisions Decisions affect an individual’s financial situation

  4. NEEDS vs. WANTS A need is something thought to be a necessity or essential items required for life • Examples of needs: • Food • Water • Shelter A want is something unnecessary but desired or items which increase the quality of living • Examples of wants: • Car stereo • MP3 player • Designer clothes

  5. WHAT IS A GOAL? A goal is defined as the end result of something a person intends to acquire, achieve, do, reach, or accomplish sometime in the near or distant future Identifying goals makes decision making easier

  6. Term Goals • SHORT-TERM GOALS • Within three months • INTERMEDIATE-TERM GOALS • Three months to a year • LONG-TERM GOALS • More than a year 1-E

  7. HOW DO VALUES, NEEDS, WANTS AND GOALS RELATE TO FINANCIAL DECISIONS? Financial Decisions Decisions

  8. Decision-Making Process Identify Your Goal Establish Criteria Weigh Pros and Cons Make a Decision Evaluate Results 1-K

  9. The Five-Step Financial Planning Process 1-B

  10. NEFE High School Financial Planning Program Set Goals Identify Your Goal Analyze Information Establish Criteria Create a Plan Weigh Pros and Cons Implement the Plan Make a Decision Monitor & Modify the Plan Evaluate Results Unit One - Your Financial Plan: Where It All begins The Decision- Making Process Decision Making and Financial Planning The Financial Planning Process 1-L

  11. SMART FINANCIAL GOAL • Goal – I want to buy a new car • SMART goal – • Specific – I plan to save for a down payment on a new car • Measurable – I plan to save $5,000 for a down payment on a new car • Attainable – I plan to save $5,000 for a down payment on a new car by saving $200 from every paycheck • Realistic – It is realistic to save $200 from each paycheck for a down payment on a car because I usually waste the money on unnecessary items instead of saving it • TimeBound – I plan to save $5,000 for a down payment on a new car by saving $200 from each paycheck for two years.

  12. WHAT IS MISSING? • Find the missing SMART goal element (specific, measurable, attainable, realistic, or time bound) for each of the following financial goals • Financial Goal #1 • I plan to save $5,000 for college living expenses in four years. Attainable

  13. WHAT IS MISSING? Measurable • Financial Goal #2 • I plan to save for a new computer by saving $150 each month for one year.

  14. WHAT IS MISSING? Specific • Financial Goal #3 • I plan to save $2,500 by saving $105 each month for 2 years.

  15. WHAT IS MISSING? Time Bound • Financial Goal #4 • I plan to save $1,500 to buy a used car by saving $75 from each paycheck.

  16. WHAT IS MISSING? Realistic • Financial Goal #5 • I plan to save $2,000 to pay for a new computer by saving my whole paycheck for the next 6 months.

  17. SUMMARY A value is a fundamental belief or practice about what is desirable, worthwhile, and important to an individual A need is something thought to be a necessity or essential items required for life. Examples include food, water, and shelter A want is something unnecessary but desired or items which increase the quality of living A goal is defined as the end result of something a person intends to acquire, achieve, do, reach, or accomplish Wants Values Needs Goals

  18. SUMMARY Values guide a person’s needs, wants and goals This influences a person’s daily decisions, which may affect their financial situation • Goals should be written down as SMART goals • Specific, measurable, attainable, realistic, and time bound

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